Diamond Circle to turn NFC tags into Bitcoin wallets

CONCEPT: An artist imagines how Diamond Circle’s Bitcoin ATMs could appear in malls

An Australian startup is to begin issuing NFC tags that act as Bitcoin wallets, NFC readers that merchants can use to charge customers in Bitcoins, and to provide Bitcoin ATMs that can be used to issue new wallet tags as well as top up and withdraw funds from Bitcoin accounts.

The NFC tags can be affixed to the back of a mobile phone and are used to store the owner’s Bitcoin balance and their private key, Diamond Circle CTO Stephen Rowlison told NFC World.

“They are encoded using our proprietary technology which prevents a ‘man in the middle’ attack — where vital data is stolen or manipulated during transfer,” he explained.

Merchants can then use a standard NFC reader attached to a PC to read a tag’s balance and transfer the cost of a purchase from a customer’s Bitcoin tag to their own account.

“The software will automatically adjust the amount of Bitcoins the customer pays,” the company says. “For example, if a coffee costs $3.50, the system works out how much $3.50 is in Bitcoins immediately and in your currency”.

The NFC reader can also be used to load credit onto a tag. “In this scenario a consumer may present their cash or credit card to a merchant, who transfers bitcoin to the consumer’s tag,” Rowlison explains.

The Bitcoin ATMs are designed to be installed in shopping centres as standalone units, he added, enabling users to purchase NFC tags pre-loaded with their choice of Bitcoin balance as well as top up the balance on their existing tag by tapping it to the machine. The ATMs will accept payment for Bitcoins via debit or credit card and will also allow customers to withdraw Bitcoins stored on their NFC tag in the form of a cashier’s cheque.

“By using NFC devices which are low cost and flexible, we are able to offer users a simple and safe way of storing and transacting Bitcoin,” Rowlison says. “In the case of a lost or stolen tag our web portal can be used by a consumer to cancel and transfer the balance to another tag.”